‘It’s Gung Ho’: The Big Banks Are Minting Money Again
Credit-card delinquencies just hit a 15-year high and consumer sentiment is in the basement. So why are the biggest banks in America rolling in profit? Because from where they sit, dealmaking, trading, and IPOs are all going off at once.
Ben Glickman · The Wall Street Journal · May 30-31, 2026 · Capital Wealth analysis by Sean Anees Saifi
Dealmaking is back on Wall Street.
A Tale of Two Economies
There’s a genuine puzzle in this weekend’s paper. On the front page: credit-card delinquencies hit 13.12% in the first quarter — the highest in 15 years — on a record $1.25 trillion of card debt. Consumers are clearly straining.
Flip to the markets section and the big banks are partying. “It’s gung ho,” said JPMorgan (JPM) CEO Jamie Dimon. “There’s a lot of exuberance out there.” How do both things happen at once? Because the big banks make a fortune from activity — mergers, trading, and new stock listings — and right now there’s a ton of it, even as the average cardholder sweats.
Dealmaking, Trading, and an 80% IPO Surge
Goldman Sachs (GS) said the volume of initial public offerings is up about 80% so far this year and that it’s working on infrastructure financings that would rank among the biggest deals it’s ever done. Bank of America (BAC) CEO Brian Moynihan said consumers are still spending on travel and restaurants despite higher gas prices.
Market volatility — which makes most of us queasy — is a profit center for trading desks. Tariff uncertainty and geopolitical jitters mean more clients buying and selling, and the banks collect a toll on every trip. The KBW Bank index closed up on the week, quietly outperforming while everyone watched the AI stocks.
What This Means For Your Money
We’re adding to financials. When the deal machine is running this hot, the big universal banks — JPMorgan (JPM) and Goldman Sachs (GS) in particular — are a cleaner way to own “market activity” than trying to guess which IPO pops. They also tend to be reasonably valued relative to the AI high-flyers, which matters when a bank CEO is the one yelling ‘exuberance.’
The principle: diversify your sources of return. If your whole portfolio is a bet on AI chips, you’re exposed the day that story wobbles. Owning the banks that profit from volume — deals, trading, lending — gives you an engine that runs on a different fuel. One caution we’re watching: those record card delinquencies. We like the banks for their fee machines, not for piling into consumer-credit risk at a 15-year-high default rate.
